The plant manager has the plant controller prepare a segment income statement f

The plant manager has the plant controller prepare a segment income statement for each of the three binders. The difference among the binders relates to
quality. Binder A Binder B Binder C Total
Sales Revenue (given in thousands) $500 $800 $150 $1450
Less Variable expenses 250 480 140 870
Contribution Margin $250 $320 $10 580
Less direct fixed expenses
Advertising 10 10 10 30
Salaries 37 40 35 112
Depreciation 53 40 10 103
Total $100 $90 $55 $245
Segment margin $150 $230 $(45) $335
Less common fixed expenses $125
Operating Income $210 The controller explains that if Binder C was discontinued then the supervisor (represents salaries) could be dismissed. Also there would be no need for
advertising Binder C. 1. Should Binder C be discontinued and if so what other consideration(s) should the company consider before dropping Binder C? Provide calculations to support your
answer.